Author Topic: Race from $1M to $2M  (Read 9379 times)

Koogie

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Re: Race from $1M to $2M
« Reply #100 on: January 27, 2017, 07:44:48 AM »
Are y'all including equity in your primary residence as part of the net worth numbers you're posting or not?  Wondering if I should be in this thread or stay in the race-from-$500k-1m one I'm already in.  We're well past $1m if you include our home equity, but under $1m if you don't.
Happy racing!

I didn't.   Neither did the OP, so I took the same approach.
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farmecologist

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Re: Race from $1M to $2M
« Reply #101 on: January 27, 2017, 08:25:52 AM »
Are y'all including equity in your primary residence as part of the net worth numbers you're posting or not?  Wondering if I should be in this thread or stay in the race-from-$500k-1m one I'm already in.  We're well past $1m if you include our home equity, but under $1m if you don't.
Happy racing!

I didn't.   Neither did the OP, so I took the same approach.


There has been MAJOR debate about this on other threads.

I said heck with it and always just break out the total with residence and without residence.


MishMash

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Re: Race from $1M to $2M
« Reply #102 on: January 27, 2017, 08:37:28 AM »
Are y'all including equity in your primary residence as part of the net worth numbers you're posting or not?  Wondering if I should be in this thread or stay in the race-from-$500k-1m one I'm already in.  We're well past $1m if you include our home equity, but under $1m if you don't.
Happy racing!

I didn't.   Neither did the OP, so I took the same approach.

Same, way I look at it, it's still an asset, so I break it out, total net worth and investible

There has been MAJOR debate about this on other threads.

I said heck with it and always just break out the total with residence and without residence.

Metric Mouse

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Re: Race from $1M to $2M
« Reply #103 on: January 27, 2017, 04:54:47 PM »
Are y'all including equity in your primary residence as part of the net worth numbers you're posting or not?  Wondering if I should be in this thread or stay in the race-from-$500k-1m one I'm already in.  We're well past $1m if you include our home equity, but under $1m if you don't.
Happy racing!

I didn't.   Neither did the OP, so I took the same approach.


There has been MAJOR debate about this on other threads.

I said heck with it and always just break out the total with residence and without residence.

In the 'stache measuring contests, I would probably use the method that would make mine look as big as possible.
Give me one fine day of plain sailing weather and I can mess up anything.

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frugalecon

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Re: Race from $1M to $2M
« Reply #104 on: February 02, 2017, 10:46:28 AM »
Are y'all including equity in your primary residence as part of the net worth numbers you're posting or not?  Wondering if I should be in this thread or stay in the race-from-$500k-1m one I'm already in.  We're well past $1m if you include our home equity, but under $1m if you don't.
Happy racing!

I didn't.   Neither did the OP, so I took the same approach.


There has been MAJOR debate about this on other threads.

I said heck with it and always just break out the total with residence and without residence.

In the 'stache measuring contests, I would probably use the method that would make mine look as big as possible.

It's not the size of the 'stache that matters, it is how you use it...

Somewhat seriously, I live in a HCOL area, so a big chunk of my net worth is tied up in the house. But I don't particularly want to move, so it is hard for me to realize value from it, other than the obvious one of having a place to live. So it is more relevant to my financial needs to exclude it.

arebelspy

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Re: Race from $1M to $2M
« Reply #105 on: February 02, 2017, 02:18:35 PM »
It's not the size of the 'stache that matters, it is how you use it...

Well said.  I've seen people with 500k staches put it to much better usage in their life than some with 2MM+.
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farmecologist

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Re: Race from $1M to $2M
« Reply #106 on: February 02, 2017, 07:41:44 PM »
It's not the size of the 'stache that matters, it is how you use it...

Well said.  I've seen people with 500k staches put it to much better usage in their life than some with 2MM+.

Yep - totally agree!

CanuckExpat

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Re: Race from $1M to $2M
« Reply #107 on: February 02, 2017, 07:43:15 PM »
Hit ~$1.0M  in 05/2016 when we sold our house
At  $1.17M in 10/2016 we quit our jobs
At $1.18 at end of 2016

Might be a slow race to two million with no jobs, but hope to join you, doing it while sitting around drinking and hoping the markets do their magic. Slow and steady...

And at $1.2M at 1/31/2017

Presumably this particular rally will end sooner or later, it won't be as long as I thought if it keeps up like this (not that I expect it to)
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Metric Mouse

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Re: Race from $1M to $2M
« Reply #108 on: February 02, 2017, 10:27:02 PM »
Hit ~$1.0M  in 05/2016 when we sold our house
At  $1.17M in 10/2016 we quit our jobs
At $1.18 at end of 2016

Might be a slow race to two million with no jobs, but hope to join you, doing it while sitting around drinking and hoping the markets do their magic. Slow and steady...

And at $1.2M at 1/31/2017

Presumably this particular rally will end sooner or later, it won't be as long as I thought if it keeps up like this (not that I expect it to)

Nice!
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Car Jack

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Re: Race from $1M to $2M
« Reply #109 on: February 05, 2017, 12:50:32 PM »
Well, it looks like I can now claim $2M, using my criterion that it only includes investable assets.  Updated my spreadsheet and I'm at $2,006,000, so just over the mark.  I have RSUs, pay and ESOP coming up in the next month, so since I'll invest a good portion of that, it should make this number stick.  My spread sheet shows net worth and it's right at $2.6M.

No, I'm not retired.  Son #1 in college that I'm funding.  Son #2 will enter college as he finishes.  Mostly, however is that my wife is totally freaked about me retiring.  She grew up in a blue collar household where her dad was constantly being laid off as his trade went obsolete (worked in a print shop after going to trade high school, and it shut down, then a small steel mill which closed and finally after a couple years out of work for the city).  I sat down with her one night to figure out what number she would be comfortable with me calling it quits.  $2M?  No.  $10M?  No.  $100M?  No.  $100B???  No.  So I've concluded that she'll never be comfortable, so I've targeted 2 years from now.

Bateaux

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Re: Race from $1M to $2M
« Reply #110 on: February 06, 2017, 07:46:10 PM »
Not so long ago it took years to roll another 100k.  Now we roll another 100k witin a year or less.  VTSAX is in control.
“Perfection is achieved, not when there is nothing more to add, but when there is nothing left to take away.”
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Metric Mouse

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Re: Race from $1M to $2M
« Reply #111 on: February 06, 2017, 08:02:51 PM »
Well, it looks like I can now claim $2M, using my criterion that it only includes investable assets.  Updated my spreadsheet and I'm at $2,006,000, so just over the mark.  I have RSUs, pay and ESOP coming up in the next month, so since I'll invest a good portion of that, it should make this number stick.  My spread sheet shows net worth and it's right at $2.6M.

No, I'm not retired.  Son #1 in college that I'm funding.  Son #2 will enter college as he finishes.  Mostly, however is that my wife is totally freaked about me retiring.  She grew up in a blue collar household where her dad was constantly being laid off as his trade went obsolete (worked in a print shop after going to trade high school, and it shut down, then a small steel mill which closed and finally after a couple years out of work for the city).  I sat down with her one night to figure out what number she would be comfortable with me calling it quits.  $2M?  No.  $10M?  No.  $100M?  No.  $100B???  No.  So I've concluded that she'll never be comfortable, so I've targeted 2 years from now.
It's awesome that you and your wife were able to come to a compromise.
Give me one fine day of plain sailing weather and I can mess up anything.

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Bateaux

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Re: Race from $1M to $2M
« Reply #112 on: February 06, 2017, 09:15:28 PM »
Keep the incredible stories of sucess coming.  Dreams are being fulfilled.
“Perfection is achieved, not when there is nothing more to add, but when there is nothing left to take away.”
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Goldy

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Re: Race from $1M to $2M
« Reply #113 on: February 28, 2017, 05:50:03 AM »
Broke 1.3 this week and our rolling 12mo gain is 387k thanks to a great year of investing and 50k from a house sale.

chesebert

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Re: Race from $1M to $2M
« Reply #114 on: February 28, 2017, 08:56:40 AM »
Broke 1.3 this week and our rolling 12mo gain is 387k thanks to a great year of investing and 50k from a house sale.
That's impressive. Did you have to take a lot of risk for that amount of gain?

John Doe

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Re: Race from $1M to $2M
« Reply #115 on: February 28, 2017, 05:31:55 PM »
I have about $1.4 m in investments plus a defined benefit pension that will start in a little less than 4 years.  The pension will be about about $42k per year.  So where does that put me in the race?  Also have debt free home worth about $550k but let's not count that.   

OthalaFehu

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Re: Race from $1M to $2M
« Reply #116 on: February 28, 2017, 06:10:34 PM »
1 to 2 sure seems easier than 0 to 1.

I hit 1m at the end of 2013, am at 1.4 now. Really 1.9 assets but need to shave some debt.
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Goldy

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Re: Race from $1M to $2M
« Reply #117 on: February 28, 2017, 08:26:40 PM »
Broke 1.3 this week and our rolling 12mo gain is 387k thanks to a great year of investing and 50k from a house sale.
That's impressive. Did you have to take a lot of risk for that amount of gain?

No more risk than anyone else, all my investments are 100% stocks.  We saved 56k in the 401k's, 11k in Roth, 20k in company stock, 50k from the house sale, and 24k in taxable. The rest was investment gains, I think I was up 17% or so on the year

MishMash

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Re: Race from $1M to $2M
« Reply #118 on: March 01, 2017, 07:25:58 AM »
Officially halfway to the 2 mark, solidly crossed the 1.5 barrier.  Accounts went up 50k this month, I remember when we first started, it would take more than a year for an increase of that size (most all of it contributions, I think the savings in our very first year was like 18k), to see it happen in one month flabbergasts me.  Also makes me nervous because if it can go up 50k in a month, it can go down 50k in a month. 

markbike528CBX

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Re: Race from $1M to $2M
« Reply #119 on: March 01, 2017, 08:41:59 AM »
You have to keep the 50K in mind as a minor percentage of Net Worth, not as a (presumably) major fraction of annual income.   
Breathe deep and repeat.... it's only a small percentage.....

MishMash

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Re: Race from $1M to $2M
« Reply #120 on: March 01, 2017, 10:23:12 AM »
You have to keep the 50K in mind as a minor percentage of Net Worth, not as a (presumably) major fraction of annual income.   
Breathe deep and repeat.... it's only a small percentage.....

Lol, yea that's pretty much what I've been saying to myself but it's like the realization finally set in that our money is in control now.  That our contributions each year will mean less and less going forward.  Especially when starting out I remember reading that, and I kind of always thought "yea right, we won't hit that point"

Cornbread OMalley

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Re: Race from $1M to $2M
« Reply #121 on: March 03, 2017, 10:30:45 PM »
I have about $1.4 m in investments plus a defined benefit pension that will start in a little less than 4 years.  The pension will be about about $42k per year.  So where does that put me in the race?  Also have debt free home worth about $550k but let's not count that.
I've seen people use the "180" pension conversion formula to figure out how much their pension is worth.  The formula is this: monthly pension amount x 180 = what the pension is worth.

So if your pension pays you $42K a year that is $3,500 per month.  $3500 x 180 = $630,000.

Your pension is worth $630,000.

Somebody please correct me if I'm off base here.

arebelspy

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Re: Race from $1M to $2M
« Reply #122 on: March 04, 2017, 03:52:40 AM »
I have about $1.4 m in investments plus a defined benefit pension that will start in a little less than 4 years.  The pension will be about about $42k per year.  So where does that put me in the race?  Also have debt free home worth about $550k but let's not count that.
I've seen people use the "180" pension conversion formula to figure out how much their pension is worth.  The formula is this: monthly pension amount x 180 = what the pension is worth.

So if your pension pays you $42K a year that is $3,500 per month.  $3500 x 180 = $630,000.

Your pension is worth $630,000.

Somebody please correct me if I'm off base here.

Why 180?  Seems really arbitrary (15 years x 12 mo/yr = 180).

Really depends on the details of the pension, too.  Is it COLA adjusted?

I'm not a fan of that "multiply by 180" thing.  Never heard of it, and can't fathom where it'd come from, or how a blanket number would apply to all.

To get the value of a pension, if it has a cash out value, use that.  If not, I'd either:
1) Price an annuity that pays the same as the pension, and value it at that, or
2) Do a NPV of the income stream based on actuarial tables for lifespan.

Both are valid, IMO.
We are two former teachers who accumulated a bunch of real estate, retired at 29, and now travel the world full time with a kid.
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Itchyfeet

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Re: Race from $1M to $2M
« Reply #123 on: March 04, 2017, 05:43:16 AM »
I'll get a small pension, and the way I am valuing it is:

[Pension in today's $]*25* 1.04^-[number of years till I can draw the pension]

So, for example I am 45 and can get my pension at 55. It is worth $13,000 a year in today's dollars and is indexed to CPI. It will pay until I die. So I value it as

$13,000*25*(1.04)^-10 = $219,500.

I feel that this method is consistent with the 4% rule.

Each year the future payout gets inflated by CPI and the discount gets reduced when I value my stash. So let's say this year we have 3% inflation, then my pension increases to $13,390 and I would value the pension as

$13,390*25*1.04^-9 = $235,190.

Once I get to 55 I won't value it this way.  I'll just reduce the spending I am trying to cover by the pension I have, just like my house (ie: I don't include the house and I don't include rent expense).

 But for now, I like to include the pension in my stash calculations as it just makes for simple comparisons with my expenditure budget, and required withdrawal rate, particularly as I won't get the pension for 10 years, so it's value needs to be discounted.

Itchyfeet

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Re: Race from $1M to $2M
« Reply #124 on: March 04, 2017, 05:47:03 AM »
I suppose, that given that there s almost zero risk of not receiving the pension (as it is not at the whims of the market and sequence of return risk) I could potentially use a higher multiple than 25, amd retire sooner.

begood

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Re: Race from $1M to $2M
« Reply #125 on: March 04, 2017, 08:26:05 AM »
I suppose, that given that there s almost zero risk of not receiving the pension (as it is not at the whims of the market and sequence of return risk) I could potentially use a higher multiple than 25, amd retire sooner.

Now, see, I think there's a HUGE risk of not receiving the pension. My mister's DB pension is "guaranteed" (in some portion, read the fine print, yadda yadda) by the PBGC, but even so I think there's some chance he gets to 65 in 13 years and they go, "Well, we had good intentions, but..."

Itchyfeet

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Re: Race from $1M to $2M
« Reply #126 on: March 04, 2017, 08:44:19 AM »
I am very confident that my pension from a defined benefit scheme has zero risk of non-payment. The scheme is closed now. It was an old superannuation scheme for govt. employees.

I guess Not all pensions are created equal.



markbike528CBX

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Re: Race from $1M to $2M
« Reply #127 on: March 04, 2017, 09:29:02 AM »
With 2 months notice, my Semi-Big Corp defined benefit pension is now "frozen".   I'm glad I didn't take the future projections seriously.  I didnt even bother including the immediate payout value 5k/year since it is so paltry, into my FIRE calculations.

a retire at 55,pay 19k at 60 became 18k at 65. 

hhmmm... I wonder if personnel retention will be effected? :-)

What is most galling, is that this and other penny-pinching measures are needed to fix a $Billion(s) F$&@up by upper "management" for lack of due diligence.

Itchyfeet

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Re: Race from $1M to $2M
« Reply #128 on: March 04, 2017, 09:33:53 AM »
Ouch. That sucks. I imagine some peeps have lost out big time. Hopefully they sort out their shit amd your entitlements are paid.

markbike528CBX

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Re: Race from $1M to $2M
« Reply #129 on: March 04, 2017, 09:57:09 AM »
They have basically switched all of us to the post-2013 new hire defined contribution scheme ( not a 401K, but similar)   of 3% of salary.   Not sure how it saves Semi-BigCorp money. Not my problem ( have FU Money).

Davids

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Re: Race from $1M to $2M
« Reply #130 on: March 04, 2017, 11:56:38 AM »
I hope to join this race sometime in mid-late 2018.

Bateaux

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Re: Race from $1M to $2M
« Reply #131 on: March 18, 2017, 04:54:32 PM »
Looks like we've crested 1.7M without real estate.  Could cheat and claim 2M total NW but, 2M is my number for invested assets. Without a recession we should be on a glidescope to FIRE 2019. 
“Perfection is achieved, not when there is nothing more to add, but when there is nothing left to take away.”
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BTDretire

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Re: Race from $1M to $2M
« Reply #132 on: March 19, 2017, 08:08:02 AM »

Besides the fact that it's rude to judge others on their goals, those who think $2 million is way more than they'd ever need to save for retirement also ought to take into account the effect of inflation.   It's all well and good to want to retire on $750k in current dollars.  But if you're in your 30s or even your 40s at FIRE, you could easily have a 50-60 year retirement life expectancy.  Over that time, your $750k will need to become much greater as your money becomes worth less.  In fact, you would likely need to exceed the $1 million mark within a decade or so after FIRE, depending on what you assume for a rate of inflation.

My goal for FI is $800k in 2015 dollars, and I am assuming a 3.5% inflation rate.  This means that I will need to have accumulated $1 million in 2022, and $2 million within about 27 years.  Since I'm only 41 now, yes, I intend to live long enough to need to accumulate $2 million.  And I won't even be collecting SS yet when I do!
  I'm with you and Metric Mouse, more is better unless you really can't stand your job. I'm older semi retired and my wife plans on working 5 more years, mostly to put my daughter through dental school
(about $250,000), I don't expect we will save anything during the next 5 years but I hope to be at $2M by then on market growth and the 2% dividends from VTSAX.

Bateaux

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Re: Race from $1M to $2M
« Reply #133 on: March 20, 2017, 09:55:33 PM »
I really think 2M is a good goal for most.   I would hate leaving a high paying field in middle age when I lack the passive income to live comfortable, with health care and able to travel.
“Perfection is achieved, not when there is nothing more to add, but when there is nothing left to take away.”
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BTDretire

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Re: Race from $1M to $2M
« Reply #134 on: March 21, 2017, 07:14:41 AM »
I really think 2M is a good goal for most.   I would hate leaving a high paying field in middle age when I lack the passive income to live comfortable, with health care and able to travel.

  Yes, obviously higher than most a seeking, and I suspect the kids will get
a nice inheritance. But not a bad place to be, especially with the this healthcare
problem hanging over us.
  On healthcare, it's not about who pays for it, it's about reducing the cost of care.
That may mean a reduced quality of care and some delay in care,
but that could still be quality care.

Car Jack

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Re: Race from $1M to $2M
« Reply #135 on: March 23, 2017, 06:46:39 AM »
I have a very small pension that if I waited till 65, would be about $300 a month.  I could take lump sum right now of $53,000.  This is from a private company and the money is sitting in Fidelity (shows in my account as the current company name pension).  Even still, I have zero trust in pensions.  I don't know if it's 100% funded or 10% funded.  In my retirement planning, I consider it to be zero.  I suppose if I had to depend on it, I would be best to take the lump sum now.  Maybe I should look into it further because I think I can actually roll it into one of my IRAs.


begood

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Re: Race from $1M to $2M
« Reply #136 on: March 23, 2017, 06:58:58 AM »
I have a very small pension that if I waited till 65, would be about $300 a month.  I could take lump sum right now of $53,000.  This is from a private company and the money is sitting in Fidelity (shows in my account as the current company name pension).  Even still, I have zero trust in pensions.  I don't know if it's 100% funded or 10% funded.  In my retirement planning, I consider it to be zero.  I suppose if I had to depend on it, I would be best to take the lump sum now.  Maybe I should look into it further because I think I can actually roll it into one of my IRAs.

Car Jack, is the company part of the PBGC program? It's like the FDIC for pensions (not literally, but analogously). If your company participates in the PBGC, a portion of your pension would be "guaranteed".

We are rolling the dice on a pension as well - one that would provide $27K/year but is NOT adjusted for inflation. We were offered a lump sum that appeared to be about half of what the eventual value should be. We decided to stick with the eventual annuity instead. We'll see how that turns out in 12 years.